How Contact Segmentation Can Drive Greater Engagement & Sales

Most marketers today understand the value of knowing their customers.

It makes sense that the more you know about them, the better you can adjust your marketing strategies and communication style to relate to them better and hopefully help them make the decision to buy from you.

Segmenting your contact list and your communication to individual groups of people can improve your overall marketing and sales in a very big way and help you create a much more personalized marketing experience.

If you’re sending the same email messages to the same list of contacts and you’re not putting them into various segments or groups it’s probably time you learn more about how list segmentation can help you drive engagement and overall higher conversion rates.

A 2013 Email Marketing Benchmark Report by Marketing Sherpa found that 32% of marketers say that segmenting their contact database is one of their companies top priorities. Further to that, 52% of marketers say they have a great need to improve email database segmentation.

The reality is that not all customers are the same

We all have different wants and needs, likes and dislikes and there simply is no one-size-fits-all customer. Your business probably has several ideal customers and knowing who they are and what makes them ideal makes for some powerful insights for executing your marketing.

For example, if you own a snowboard manufacturing company, you might market to very experienced “hardcore” riders as well as to riders that have families with kids just starting out on the slopes.

These are two very different types of customers who have very different wants and needs and you should be treating them differently when you are communicating with them.

If you’re doing an email marketing campaign to these target customers, blanketing them with the same, generic message wouldn’t be anywhere as effective as sending each of them a targeted message that spoke to their specific wants, challenges and needs.

Let’s think about this for a minute. If you were a dad with two kids under 3 and you get out to the ski resort to ride only once or twice a year, which of the following two emails would you be more likely to open?

One that’s promised to provide you with instruction on ‘How to execute a 720 in the halfpipe”, or one that’s offering ‘Family snowboarding vacation tips and tricks’, specifically written to address the challenges of parents trying to get more than 2 days on the hill each year?

It may sound trivial, but that second email, when sent to a targeted list of ski and snowboard parents, would perform much better than a general message to your entire list of contacts.

Start with Buyer Personas

If you haven’t already determined who your various segments of target customers are or as we call them, buyer personas, it’s something that you should really consider doing. Once you figure out your buyer personas or the types of individuals that make up your contacts list as a whole, segmenting them becomes much easier to do.

The great thing about customer segmentation is that the possibilities are endless. You can start by identifying 3 or 4 general buyer personas, then get more granular with each of them, splitting them into even more targeted groups, making your segmentation even more effective.

If you were that snowboard company you may have a buyer persona for hardcore riders, backcountry enthusiasts, and parents that ride with their kids. You may then segment your end user personas further by gender, age, interests, geographic location, past purchases and even by the types of content they have viewed on your website.

Imagine knowing who in your list either skis or snowboards or both, the resorts they frequent and would like to go to, their favorite brands and their level of expertise & experience on a board. All of a sudden, your marketing campaigns can be mush more relevant to your specific audience.

When relevance increases, engagement does too.

Your Contacts are at Different Stages of the Buyers Journey

All of your contacts are at different points of interaction with your business. They can be new prospects, warm leads, and even customers. This means they each require different types of information and communication depending on which point they’re at.

The 3 major stages of the buyer’s journey are the Awareness, Consideration & Decisionstages.

Let’s look back to our snowboard manufacturing company example for a minute.

Let’s say one of your personas is called “Peter the Parent” and he’s on your list because he subscribed to your blog or newsletter and he’s been watching a few snowboard movie trailers every couple of months on your website and looking at kids gear.

Peter and his wife used to snowboard 20 to 30 days a year but since having kids, they’ve spent less time on the mountain and more time rasing their kids. They wish they could get out more but their lives are still too busy. Right now Peter and his wife like their own gear but they’re starting to look for a snowboard for their son who is 1 and a half but won’t start riding till he’s 3.

Another one of your personas is called “Backcountry Bill” and he’s on your list because he opted in to your email newsletter after reading a blog post about your new split board.

He also watched a video of a pro using it in the backcountry and downloaded the boards PDF spec document. Bill’s been planning a trip to snowboard on the coast mountains near Whistler for 2 years now and he’s been scouring the web, reading up on various split boards trying to decide which one to buy.

Sounds like Bill might be much closer to making a purchasing decision than Peter doesn’t it?

If you send Backcountry Bill targeted content about the splitboard or other relevant options that caters to the stage of the sales cycle he’s in rather than an email written with general content in an attempt to also include Peter, you will have much better conversions.

When you send highly targeted and contextual email to your contacts, your emails naturally become more engaging to that segmented group of your audience. If you continue to get more and more targeted with your messages, your audience will come to expect content from you that is engaging, interesting, useful and relevant to them.

You’ll Reach Your Goals Faster

Every thing you do should be aligned to the goals you set and segmenting your contacts has proven to outperform general, untargeted email blasts. The graph below from the Lyris Annual Email Optimizer Report show the results marketers experience when they segment their contacts.

As a HubSpot partner, we get access to some great research and we’ve found that targeted and segmented lead nurturing emails generate an 8% click-through rate compared to general email sends, which generate just a 3% click-through rate.

Contact Segmentation is possible but it’s not easy.

Developing your buyer personas and documenting the various stages in your buyer’s journey is just the start to segmentation and without sophisticated marketing software like HubSpot to help you actually do this level of deep segmentation, achieving this level of a highly personalized marketing experience can challenging.

Hubspot has a powerful feature called Smart Lists to make this happen. Smart Lists offer a very flexible way to organize all of your contacts in HubSpot.

You can build these automatically refreshing lists based on contacts who meet certain criteria like viewing a specific page or submitting a specfic form on your website. The options here are limitless.

When you segment your contacts there are then amazing workflow tools you can use to automate marketing actions like sending targeted and timely emails.

Marketers who take advantage of contact segmentation and do it well are reaping higher conversion rates, better deliverability, and overall generate more revenue from their email lists and campaigns than their non-segmenting competitors.

To succeed in today’s highly competitive market, companies need to have a deep understanding of their customers and then communicate with them as individuals based on this understanding. Contact segmentation is just one piece of the strategy to accomplish this.

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